While the stay-at-home economy is booming, many businessmen are turning their heads to mobile application development. According to Statista, we have 3.2 billion smartphone users worldwide, and it seems that this number keeps on growing. Despite the attractiveness of this business venue, starting to build an app from scratch isn’t as easy as it might seem.
Once you get into the process of building an app and a whole business behind it, chances are that you’ve missed many details that didn’t cross your mind before. Don’t worry, that’s completely natural. Most financial institutions have already started developing their versions of mobile banking processes. Let’s take a look at the best practices and the do’s and don’ts regarding fintech app development.
Facts You Need to Know about Fintech
Financial technology, or Fintech, describes mobile applications, software, and similar technologies, which help improve traditional banking in terms of automation and availability. The term includes not only fintech apps but also more complex structures, like encrypted transactions and blockchain.
Even though the first traces of finance and technology take us back to the late 19th century, the real evolution made its mark in 2008, during the economic crisis. Physical banking branches no longer satisfied the customers who demanded better, quicker, and safer services. You can say that this is when sci-fi movies, at some point, became a reality.
Statista reports that 4,6% of US citizens used online banking last year, showing other interesting facts:
- 10% of customers aren’t comfortable with technology, which makes them feel unsafe regarding digital banking.
- More traditional banking enterprises are investing in mobile banking and app development, aiming to outperform competitors.
- Four in five respondents prefer to manage their finances through a smartphone device rather than visiting a physical branch.
Top Fintech Applications and their Recipe
It’s obvious that you can learn a lot from previous success stories. By researching and analyzing the Fintech market, you can better understand your competition, including other organizations’ strengths and weaknesses. By comparing your strategy to others, you can easily recognize the gaps in your strategy, and this way, upgrade your system.
The same method applies to fintech app development. Once you know the pros and cons, you’ll be able to find more efficient ways to solve existing issues. Check out some examples of successful fintech startups that showed their success throughout the years:
- Coinbase. A digital currency exchange platform that offers its users the ability to sell and purchase digital currencies, such as Bitcoin or Ethereum.
- Binance. Unlike Coinbase, Binance focuses more on experienced crypto traders due to the not-so-straightforward or user-friendly approach toward beginner traders. Supporting more than 65 digital currencies in the US, the fintech app focuses on offering the lowest charges, making the platform more attractive.
- Stripe. One of the leading online payment gateways, used by various global e-commerce players. Stripe targets other businesses rather than customers, which makes them different from PayPal.
- Revolut. No physical branches. That’s how the neobank, aka the virtual bank of Revolut, works. Many customers choose this app due to its low fees and fewer additional charges.
Why it’s Important to Find a Niche
Before jumping into the app development process, it’s essential to understand that you can’t cover it all. That’s why it’s important to understand your audience and determine what niche is best for you. Here are some other fintech domains that you can consider:
- Mobile banking;
- International money transfers;
- Accounting and tax services;
- Blockchain solutions.
Whether it’s crypto trading, insurance, or personal payments, the first step is to think of fresh ideas that would solve the current problems in the market. With all of the existing technologies and plenty of fintech solutions, this isn’t as easy as one might think. Also, it’s best that you focus on developing your app in the local market. Once you get the hang of it and attract investors, you can use the funds to expand to global markets.
Learn to Identify Your Competitive Advantages
You can increase your understanding of the market by analyzing your competition and distinguishing your services from existing products. To put it simply, you need to find unique value propositions, which will be your competitive advantage that’ll lead your app to success. Of course, at first glance, the fintech market is extremely extensive and competitive.
Despite that, the fintech landscape has its dominants, which are constantly changing and evolving. As a newcomer, you need to resonate with your users by offering them a simple, yet convenient app that would be relevant to your target audience.
Review All Legal Requirements
Even though every country and region has its own compliance and regulation requirements, before launching your app, you need to review and analyze all of the privacy laws. Usually, businesses look for help by hiring legal advisors who help define laws based on the organization and the counties that your app is designed for. Some examples of the best-known law practices in the fintech market is the obligation to stick to GDPR. Let’s not forget Anti-Money Laundering (AML) compliance as well as the Know Your Customer (KYC) laws.
For instance, KYC regulations require fintech apps to onboard trusted and verified customers. A standard way to authenticate a newly registered customer today is to automatically review their identity document. That means most fintech companies are required by law to employ remote, AI-powered Identity Verification services that are speedy and easy to use. By following this practice, as a fintech app, you ensure that no money laundering activities occur and no fraudsters with fake identities are welcomed to your platform.
The mobile app development numbers in the Fintech market are continuously growing, together with customers that are spending more time on their phones. That’s why the current digital sphere is undoubtedly a great space to build a valuable, consumer-friendly fintech app. Even though there are some challenges, especially when it comes to security. Once you put yourself into the customer’s shoes and identify the niche, you can overcome all challenges with a professional developers’ team at your side.